Magnus Energy replies to 37 queries by Singapore Exchange and Catalist sponsor

CATALIST-LISTED Magnus Energy Group has replied to questions over issues raised by its former managing director in two The Business Times articles from May and June, in a 16-page document that addressed 37 queries in all from its sponsor, Stamford Corporate Services, and the Singapore Exchange.

Some of the other queries that Magnus replied to in its Friday night statement were related to PT Hanjungin, an Indonesian contractor that owes the company S$6.9 million. The former managing director, Charles Madhavan, had been quoted in BT as saying that he was concerned about the outstanding loans.

"The outstanding amount owed to the company must not be singled out and taken out of context in relation to the entire business relationship between the company and PT Hanjungin," said Magnus.

It disclosed that PT Hanjungin has not kept up with the repayment of the restructured interest, but said that the Company is still in talks with PT Hanjungin, which it said has "demonstrated themselves (sic) to be reliable partners to-date and have (sic) always responded promptly with updates".

Magnus also said that it would not be in its interests to demand immediate payment, as PT Hanjungin would be unable to service the debt if it became insolvent.

The company told the sponsor and the bourse that it conducted due diligence before engaging PT Hanjungin, including reviewing references for past construction and engineering projects.

Asked for more details on a dispute involving a plot of land in Timor that Magnus took as collateral, the company said that PT Hanjungin is the legal owner of 15 hectares that are part of a larger parcel at the heart of an inheritance scuffle.  PT Hanjungin is a defendant and party to the dispute, it added.

Magnus closed flat at S$0.001 before the announcement.